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World 15 Company 2 Year 5 Quarter 4 CONSOLIDATED INCOME STATEMENT 11-18-2013 A BUSINESS POLICY GAME, 6TH EDITION 15:54:42 Copyright (c) 2010 by Richard V. Cotter and David J. Fritzsche ____________________________________________________________________________ Consoli- Merica Merica Merica dated Area 1 Area 2 Area 3 Sereno M$000s M$000s M$000s M$000s Ps000s Net Sales: to Customers 4289 1284 1401 1247 4270 to Affiliates (cost + 20%) 0 0 2479 0 3993 to Liquidators (at cost) 0 0 0 0 0 Less Cost of Goods sold 2159 804 2759 977 5157 Less Value Added Tax 36 0 0 0 427 Gross Profit 2094 480 1121 270 2679 Selling Expense: Advertising Expense 55 15 15 15 120 Sales Salaries 130 33 48 36 152 Sales Commissions 103 31 37 30 60 General Selling Expense 530 131 158 134 1278 Transportation Expense 382 195 17 164 66 Sales Office Depreciation 11 3 3 3 19 Total Selling Expense 1210 408 278 382 1695 Admin and General Expense: Research and Development 75 0 75 0 0 Total Training Expense 451 12 257 0 2171 Storage Expense 27 15 1 6 65 Executive Compensation 219 30 91 30 814 Other Expense 24 0 24 0 0 Total Adm & Gen Expense 796 57 448 36 3050 Total Operating Expense 2006 465 726 418 4745 Operating Profit (Loss) 89 15 395 -148 -2066 Other Income: CD Interest 8 0 8 0 0 Capital Gain (Loss) 0 0 0 0 0 Other Expense: Loan Interest 0 0 0 0 0 Bond Interest 45 0 45 0 0 Net Profit (Loss) Before Tax 52 15 358 -148 -2066 Less Income Tax 20 0 20 0 0 Net Profit (Loss) After Tax 32 15 338 -148 -2066 Foreign Currency Adjustment 2766 Comprehensive Income(Loss) -2734 15 338 -148 -2066 ____________________________________________________________________________ Tax Loss Carry-Forward -94 0 -514 -3007 Notes: Translation Exchange Rate 1.00 1.00 1.00 11.95 Minor differences in translation may be due to rounding errors. Purchases from Affiliates is consolidated with Sales to Affiliates. Dividends to Parent is consolidated with Dividends from Subsidiaries.